Gov. Malloy’s Many Tax Hikes

Gov. Malloy has proposed dozens of tax increases across 25 categories of taxes. This is a conservative count; we aren’t counting each separate expansion of the sales tax as a separate tax hike, though of course they are.

Income tax: Increases income taxes on individuals making more than $50,000 a year and couples making more than $100,000 a year; increases the highest income tax rate from 6.5 to 6.7 percent; eliminates the 3% bracket on an individual’s first $10,000 in earnings and a couple’s first $20,000 for those making more than $56,500 and $100,500, respectively; expands the number of brackets from 3 to 8.

Sales tax increase: Increases the state sales tax from 6 percent to 6.25 percent and to 6.35 percent at retail locations.

Sales tax expansion: Applies the sales tax to now-exempt items such as hair cuts, car washes, and clothing and footwear that costs less than $50.

Cigarette tax: Raises taxes on cigarettes by 40 cents a pack, from $3.00 to $3.40; increase tax on snuff from 40 cents to $1 per ounce; increases tax on other tobacco products from 20% to 50% of wholesale price

Alcohol tax: Raises taxes on alcohol by 20 percent (tax on distilled spirits goes from $4.50 a gallon to $5.40; tax on beer goes from 20 cents a gallon to 24 cents; tax on wine goes from 60 cents a gallon to 72 cents)

Gas tax: Increases the state gas tax from 25 cents a gallon to 28 cents a gallon; and diesel fuel from 26 to 28 cents a gallon.

Earned Income Tax Credit: Increases state spending by more than $100 million though a new, negative income tax of up to $1,700 for low income households that earn less than about $21,500 a year from their jobs.

Death Tax: Lowers the estate tax exemption from $3.5 million to $2 million, making more of an estate subject to the estate tax, which starts at 7.2% and rises to 12%, over and above the federal death tax.

Corporate tax: Extends a 10 percent corporate profits tax surcharge on large businesses for two more years (beware those “temporary” tax increases…); establishes “throw back” rule expanding their income subject to state taxation.

Luxury sales tax: Applies an additional luxury sales tax of 3 percent on clothing over $1,000, jewelry over $5,000, vehicles over $50,000, and boats over $100,000.

Driver’s license: Increases the driver’s license tax from $66 to $72, good for 6 years ($1 a year increase).

Health facilities: Raises taxes on hospitals, nursing homes, and intermediate care facilities for the mentally retarded, in an effort designed to trigger federal reimbursements.

Energy tax: Establishes a new tax of 2/10ths of a cent per kilowatt on electricity generated in Connecticut, with a special interest exemption for favored “green” energy producers. (Editor’s note: A reason to oppose the creation of new taxes of any kind is that they are often increased or expanded in future years. Example: state income tax.)